Russia faces more sanctions

MARIUPOL, Ukraine: European leaders were set on Monday to unveil punishing new sanctions on Russia after weekend fighting in Ukraine imperilled a fragile truce aimed at halting a bloody pro-Kremlin uprising.

Ukrainian soldiers fortified their positions around Mariupol on Monday after insurgent attacks late Saturday on government positions on the eastern edge of the strategic port city.

The shelling killed one woman—the first casualty since the warring parties signed a truce on Friday aimed at ending five months of fighting that has killed nearly 2,800 people and plunged East-West relations to a post-Cold War low.

“Another Grad missile fell here overnight,” the commander of a Ukrainian checkpoint to the east of the government-held city said without disclosing his name.

“There was close combat about two kilometers from here,” he added.

The Ukrainian military also said separatist militias had violated the truce on five occasions overnight in the rebel-held strongholds of Lugansk and Donetsk in eastern Ukraine.

The first attacks outside Mariupol broke out only hours after Ukrainian President Petro Poroshenko and Russian leader Vladimir Putin issued nearly identical statements on Saturday agreeing the truce was “generally holding” and vowing to pursue further steps toward peace.

The European Union (EU) said it was ready to review plans for new sanctions against Russia over its role in the Ukraine conflict, if the truce holds.

Western governments accused Moscow of sending in huge numbers of troops and heavy weapons to back insurgents who launched a counter-offensive across the southeast in late August, dramatically turning the tide of the conflict.

EU President Herman Van Rompuy said on Sunday the measures could be reconsidered “if the ceasefire is durable, and/or if the peace talks start”.

“We have noted that Russia only consented with difficulty to serious negotiations. The ceasefire is an important step, but it is only a step,” he told Belgian television.

The new round of sanctions set to be approved on Monday would tighten existing measures imposed in July, targeting more individuals with travel bans and asset freezes, as well as tightening access to capital markets for Russian oil and defense companies.

Russian Prime Minister Dmitry Medvedev vowed to adopt “asymmetric” measures against Europe by forbidding its airlines from flying over the country on their lucrative routes to Asia should the new punitive steps go into effect.

“Our understanding is that we have friendly relations with our partners, which is why the skies over Russia are open to flights,” Medvedev told Moscow’s Vedomosti business daily in an interview published on Monday.

“If we are sanctioned, we will have to respond. If Western airlines are going to circumvent our airspace, this could bankrupt many companies that are already teetering on the edge of survival,” he added.

Economists estimate that such restrictions would cost EU carriers tens of thousands of dollars per flight in additional fuel and operating cost.

But the measure would also strip Russia’s flag carrier Aeroflot of hundreds of millions of dollars in annual revenues it gets from EU airlines as compensation.